Fears about fallout from political squabbling may affect inflow of dollars
JAKARTA: If two recent reports are anything to go by, offshore investors are beginning to temper their bullishness about Indonesia's growth prospects with some measure of doubt. On Thursday, Reuters quoted a senior manager at JP Morgan Asset Management's Hong Kong office as saying that it could sell its Indonesian shares in the short term due to political tensions.
'Indonesia is a long-term domestic growth story, but we may take profits in the short term as increasing political noises can potentially delay projects,' its vice-president of investment services, Ms Grace Tam, was quoted as saying.
Separately, the head of research at the Jakarta-based Bahana Securities, Mr Harry Su, recounted in The Jakarta Post that he had faced a barrage of questions about Indonesia's 'deteriorating political landscape' in recent meetings with fund managers in Hong Kong and Singapore. To The Straits Times yesterday, Mr Su said: 'I have never seen this kind of interest or got as many questions on the political front since 1998 and 1999.'
Indonesia was rocked by political and economic turmoil after the 1997 Asian financial crisis caused massive unemployment and food shortages. Violent riots erupted in major cities, eventually leading to the resignation of strongman Suharto in May 1998. Fund managers have indicated that they could exit the Indonesian market by June on the back of a likely hike in interest rates due to rising inflation, which would then dampen growth. So, a possible stock market correction later this year cannot be interpreted as a sign of trouble.
Nevertheless, the growing skittishness about the risk of fallout from Indonesia's political situation should not be taken lightly, said Mr Su. After all, these views will have a long-term bearing on foreign dollars flowing into the country.
Indonesian President Susilo Bambang Yudhoyono recently tasked his foreign envoys based overseas to woo investments from China, the United States and countries in Europe and the Middle East.
Yet at home, two respected reformists in his Cabinet - Vice-President Boediono and Finance Minister Sri Mulyani Indrawati - are facing flak for defending their decision to bail out the private Bank Century in 2008. Critics have labelled the move a misuse of state funds. A parliamentary inquiry is ongoing but rising tensions within Dr Yudhoyono's coalition could drag out the inquiry and, in a worst-case scenario, lead to the loss of both Cabinet ministers.
More immediately, the tension between Golkar - which seems to be moving steadily towards the opposition - and Dr Yudhoyono's Democratic Party could also impede the passing of laws on economic reforms like electricity tariff hikes or labour law revisions, Jakarta-based analyst Kevin O'Rourke said in his Reformasi Weekly newsletter.
Indonesia watchers have the example of Thailand at the back of their minds. In the past four years, its protracted political stalemate, street protests and civil unrest dented economic progress and the confidence of investors.
Hopefully, the same scenario will not play out in Indonesia. There are grounds to believe that it could hit moderate growth of 5 per cent to 5.5 per cent this year, and more in the years to come if the government ups its game. After all, it has not done too bad a job in its first 100 days, despite the barrage of media reports complaining otherwise.
According to sources in the Burmese military, junta leader Snr-Gen Than Shwe will announce the election timetable and law by the end of February. The sources, who cannot be named due to the sensitivity of the information discussed, say that the army is recruiting candidates from outside its own ranks to compete in military-backed parties during the election, targeting businesspeople and community figures such as teachers in townships and villages across the country. Prominent candidates are likely to include leaders of the Union Solidarity and Development Association (USDA), a "civil society organization" supported by the junta. The USDA has an estimated membership of 20 million people, many of whom have been forcibly recruited.
Burma watchers speculate that the junta will hold the polls on October 10—the 10th day of the 10th month of the 10th year—because it is thought to be auspicious for senior regime figures, who are said to be firm believers in numerology.
The extent of the choice available to the Burmese people has yet to be confirmed, however. Opposition leader Aung San Suu Kyi is barred from competing due to her marriage to a British academic. Her presence on the campaign trail could galvanize her party and Burmese voters. However, she remains under house arrest and it seems unlikely that she will be released prior to the election, despite calls from the United States, United Nations and Association of Southeast Asian Nations.
APPROACHING the final battle. Even Prime Minister Abhisit Vejjajiva has admitted that the crisis situation will intensify in the period ahead of the Supreme Court's ruling on Thaksin's assets seizure case on February 26, and thereafter until March.
The military is getting ready to intervene with a pre-emptive strike at any time. General Anupong Paochinda, the Army chief, will be conspicuously absent from the country between April 4 and 14, during which time he will be travelling in the United States. He has stepped back and agreed, willingly or unwillingly, to hand over power to his deputy, General Prayuth Chan-ocha. Prayuth is the man of the hour.
Anupong has insisted that there won't be a coup. In a way, he is correct. If a coup were to happen, he would not be around to make it. It is only a matter of time before the vicious cycle of Thai politics completes another circle yet again.
Thaksin Shinawatra is also getting ready. This is the moment he has been anxiously waiting for. He still believes quite confidently that he will prevail in a self-styled "civil war" staged by his "red army". Only over his dead body will he allow his Bt76 billion to be taken away. It is his last fortune. Thaksin's hardcore lieutenants Veera Musikapong, Jatuporn Promphan and Natthawut Saikua are making their final preparations. The red-shirt protesters are staging an uprising nationwide, targeting the military and government agencies. The red-shirt clusters remain small as they undergo training and do warm-up exercises.
But General Panlop Pinmanee and Major General Khattiya Sawasdipol, alias "Sae Daeng", will emerge as the real leaders on the field. They have travelled to see Thaksin in Cambodia to receive their final instructions. To heighten the war mode, General Chavalit Yongchaiyudh has been appointed by Thaksin as head of the "people's army".
Chavalit yesterday denied that he would head a Maoist-style peoples army. "It's impossible for me to become the supreme commander of such an army because my brother, General Songkitti Jaggabatara, who is the supreme commander, will feel uneasy," Chavalit said.
But he seems to like this appointment. "Big Jiew" is the master of political intrigue. He believes he can do the impossible.
Prime Minister Abhisit can't do anything. He can only sit and wait. As a precaution, he has changed security guards, placing his own security in the hands of Police General Thanee Somboonsap. Before this, Deputy Prime Minister Suthep Thaugsuban was responsible for Abhisit's safety. But look at what happened to Abhisit in April last year when he was almost beaten to death by red-shirt protesters inside the Interior Ministry. Abhisit is doing the right thing to play it safe. Of course, Suthep is getting mad.
The fresh signals of war had already started after a gang threw four bags of human excrement into the prime minister's Sukhumvit residence. How could the police and security guards allow that to happen? What if those four bags had been real grenades or bombs? If the life of Thailand's prime minister is not safe, how can we be sure that the life of any other Thai is also safe? The incident marks a sign of deterioration of law and order in this country.
The judiciary is also standing on shaky ground. His Majesty the King has recently called upon judges - the first time to those at the Administrative Court, and the second time to those at the Supreme Court - to perform their duty with bravery and justice. The judges have to defend justice until the day they die, the King said. The judiciary is the only hope this country has of saving the system. But nobody knows whether the judges will rise to the occasion when delivering their verdict on the assets-seizure case.
Thaksin is hoping to win the "people's war" to pave the way for his triumphant political comeback. The red shirts will create a crisis situation to test the patience of the military. If the military comes out onto the streets, there will be clashes. And if the military decides to stage a coup to pre-empt further violence, the red-shirt "army" will try to stage a counter-coup. Thaksin is confident of his support inside the country. The military is waiting patiently in the wings.
The outcome of this potentially bloody confrontation will be determined soon, most probably before the judgement day of February 26. By Thanong Khanthong for The Nation, Bangkok
The US, pointing fingers at China for spying, owns most of the playing field.
Earlier this week, Admiral Dennis C. Blair, the US's new so-called cyber-czar appointed by President Barack Obama, warned that an "increasingly sophisticated group of enemies has severely threatened the sometimes fragile systems undergirding America's information systems," according to the New York Times.
Over recent weeks, partly triggered over a controversial warning by Google that its systems had been hacked and that China was engaging in censorship of the Internet search giant, China in particular has come under fire for what critics say is a fast-growing capability to mine both commercial and military data across the planet.
However, lost in the concern about China is that the Americans invented cyber warfare. They spend more money on it and they are probably by far the most sophisticated operators in the world. If the total United States defense budget is bigger than the combined military budgets of the next seven biggest countries in the world, it is probably a safe bet that its spending on cyber warfare is in equal proportion.
By most estimates, US defense spending accounts for 45 percent of the world total, followed in order by the United Kingdom, China, France and Japan – each officially at between 4 and 5 percent. China's defense spending accounts officially for about 5 percent of the world total, although it could be considerably larger due to hidden budgetary allocations. If hidden allocations were to double China's total spending, the US would still be spending four times as much.
"The National Security Agency, the world's most powerful signals intelligence organization, is in the business of breaking into and extracting data from offshore enemy computer systems and of engaging in computer attacks that, in the NSA's words, ‘disrupt, deny, degrade or destroy the information,' found in these systems," Jack Goldsmith, a Harvard Law School professor and member of the Hoover Institution's Task Force on National Security and Law, wrote recently in the Washington Post.
"Simply put, the United States is in a big way doing the very things that Clinton criticized. We are not, like the Chinese, stealing intellectual property from US firms or breaking into the accounts of democracy advocates. But we are aggressively using similar computer techniques for ends we deem worthy."
However, as long ago as 1995, France ordered five Americans, including four diplomats, out of the country "as rapidly as possible" on charges they had engaged in economic and political spying. The US denied the charges. And, in 2000, the European Parliament announced it would investigate allegations the US spymasters had trained their sights on EU companies through its vaunted Echelon system, originally set up during the Cold War of intercept private telephone conversations, faxes and e-mails worldwide. A European Parliament committee alleged that Echelon had been used to help American companies win contracts over their EU rivals.
After US Secretary of State Hillary Clinton in a speech in late January condemned countries that censor the internet and engage in hacking, China, via a wide-ranging editorial in People's Daily fired back, accusing the United States of "doublespeak" and aiding the opposition through the Internet in Iran in the wake of Iran's contested national elections last June, which were widely believed to be rigged by the mullahs.
"We're afraid that in the eyes of American politicians, only information controlled by America is free information, only news acknowledged by America is free news, only speech approved by America is free speech, and only information flow that suits American interests is free information flow," said the People's Daily.
A series of 24 documents under the title "The Secret Sentry" released last year by the National Security Agency, Washington's premier electronic spying agency, gives a startling picture of just how overpowering America's eavesdropping capability is, although it gives no indication whether American defense cyber warriors are hacking into foreign defense departments. It may well be that American technological prowess is such, and other countries' defense means are so primitive, that they are never detected.
According to the NSA documents and other information readily available on the Internet – ironically through Google -- the NSA, headquartered in Fort Meade, Maryland, employs more than 60,000 people in intelligence, with an annual budget estimated at more than US$10 billion. As early as the 1950s, according to another of the documents -- DDE & NSA: An Introductory Survey, also by David A. Hatch for the cryptographic service, the Army Security Agency and the Air Force Security Service already had as many as 15,000 personnel each involved in electronic surveillance, the Naval Security Group another 3,300.
According to a history of the NSA by the National Cryptological School commissioned in 1984 by Lincoln D. Faurer, then the NSA head, titled "On Watch," intelligence efforts were well on their way in 1945 when intercepts indicated that the Japanese were seeking to surrender to the Russians.
The intercept, according to the history, "was to have a staggering effect on the speed and direction of the American prosecution of the war in the Pacific and the decision to drop two atomic bombs and the conduct of United States foreign policy towards the Russians for as far into the future as anyone could see."
Even before the Japanese had surrendered aboard the battleship USS Missouri in September of 1945, the US had transformed a former girl's college in Arlington, VA into the Signal Intelligence Service, known forever more as SIGINT, the heart of America's electronic spying capability, according to the document. From that point forward, the American electronic spying capability has never stopped growing.
SIGINT, in 2001, was producing 60 percent of all of the material to be found in then-President Georg W. Bush's daily intelligence summary, the President's Daily Brief, according to Presidential Transition 2001: NSA Briefs a New President by Hatch, also written for the cryptological service.
In addition to the NSA budget, the Federal Bureau of Investigation budgeted US$3.13 for counterterrorism, some US$1.64 billion for "intelligence," according to a press release last year by US Sen. Barbara Mikulski,), Chairwoman of the Commerce, Justice and Science (CJS) Appropriations Subcommittee, which oversees the FBI budget.
"Most increases in the FBI's budget request are for the FBI's counterterrorism and intelligence activities," according to Mikulski's release. "We all agree this is a top priority."
The US capability doesn't mean China isn't working feverishly to develop its cyber warfare capability. It is, and those developments have been given wide publicity, particularly through Clinton's speech and continuing expressions of alarm by Blair and others. But America's complaints resemble those of a madam in a bordello who discovers that other people are having sex. by John Berthelsen for the Asia Sentinel
Again, shots were fired at vehicles belonging to Freeport Indonesia. Kelly Kwalik’s group is suspected to be behind the attack.
THE sun was peacefully rising last Sunday when gunfire suddenly broke the silence. Along the 60th-61st mile of the Timika-Tembagapura route, a convoy of three vehicles transporting the employees of Freeport Indonesia was attacked by an armed group.
The convoy was on its way from Tembagapura to the Rimba Golf Kuala Kencana golf course. There were two buses, escorted by three members from the 2nd Pioneer Combat Unit A-Detachment of the National Police Force who were driving a LWB QRF Land Cruiser.
As usual, the convoy reported their Kuala Kencana City destination to a security post at the 68th mile. Nobody had the slightest thought that 30 minutes after leaving the post, they would end up under a rain of bullets with seven people becoming injured.
A bullet fragment entered the eye of James Howard Lochard, a Canadian employee working in the underground mining section. Another victim, Chindi Alifani Modokompit, received a gunshot wound to her right thigh. First Brigadier Budi S, Second Brigadiers E.P. Supriyadi and Abdullah, and also the three drivers were also injured. Their vehicles were heavily damaged.
Papua Regional Police Chief, Inspector-General Bekto Suprapto said that the police suspect the shots were fired from three different positions: two from the left side of the road, and one from the right. Twenty-three 5.56 millimeter bullets were recovered from the left side, the kind of ammunition used by SS1 and M16 assault rifles. “Coincidentally, the Kelly Kwalik group does have M16s and SS1s matching these recovered shells, as well as revolvers,” said Bekto.
Following the shooting that took the life of an Australian Freeport employee, Drew Nicholas Grant, last July, these waves of attack have been almost continuous. The attacks once stopped around October to January. After the Free Papua Movement (OPM)
Commander Kelly Kwalik was shot dead last December, gunfire had ceased. Kelly was suspected to be behind the attacks on Freeport grounds.
Even with Kelly Kwalik out of the picture, the accusation against his group remains. “As long as his men carry firearms, it’s very possible for them to continue their struggle,” said Bekto. He suspects that some members of Kelly’s group are still carrying firearms. These members include Tadius Yogi in Enarotali, Paniai regency, and Goliat Tabuni’s group operating in the Puncak Jaya regency.
Markus Haluk, Secretary-General of the Indonesian Association of Papua Middle Mountain Students, denied such accusation. “The police are throwing wild accusations,” he said. “The OPM had nothing to do with this.” He said the police had never discovered who the real shooters were. On the evidence that is linked with Kelly’s group, “We urge an independent investigation.”
Markus asked why the thousands of troops who stand guard over Freeport’s grounds had never succeeded in catching the perpetrators. The security unit ordered to guard the Freeport area is called the Amole task force. It consists of 1,500 men, 800 of whom are from the police, and 700 from the army. “They receive huge paychecks, yet they cannot bring things under control,” said Markus.
Freeport spokesperson Mindo Pangaribuan said that his company is indeed paying a lot to assure security. In 2008, for instance, Freeport rolled out cash of up to US$22 million to secure its areas, US$8.2 million of which was used to fund the 1,850 men of Amole task force.
Freeport is also required to provide the task force’s logistic needs, daily rations, transportation means, health care, as well as the allowances for both soldiers and officers. “We agreed to cover all the needs of our security personnel,” said Mindo. Regarding the money, Bekto said that he does not know anything about it. “I don’t know, because it depends on the number of security personnel deployed,” he said.
Opposition leader Anwar Ibrahim will stand trial Wednesday on a sodomy charge, which he says is politically motivated. Anwar was jailed for a sodomy conviction that was overturned in 2004. In a rerun of a highly polarizing 1998 case, Malaysian opposition leader Anwar Ibrahim,will stand trial Wednesday on a charge of sodomy that, if proven, could sink his resurgent political career.
The trial in the Malaysian capital, Kuala Lumpur, is shaping up as a test of the independence of Malaysia’s judiciary, which has been dogged by scandals over influence-peddling and political interference.
Anwar, who was jailed for a sodomy conviction that was overturned in 2004, says that his accuser, a former aide, is part of a political conspiracy. At a pretrial hearing Tuesday, he told reporters that he would subpoena Prime Minister Najib Razak and his wife, whom he accuses of cooking up the charge, to testify in court.
Homosexuality is illegal in Malaysia, a majority-Muslim country that has struggled in recent years with interfaith tensions. Last month, churches and mosques were attacked in a furor over the use of ‘Allah’ by a Christian newspaper, which some Muslims say infringes on their rights. Sodomy is punishable by up to 20 years in jail.
Mr. Najib took power last April and has sought to shore up a shaky ruling coalition in the face of Anwar’s opposition movement. He has denied being behind the sodomy accusation, which was lodged in 2008 just as Anwar was preparing a successful run for parliament after a court-ordered ban expired.
But there seems little doubt that ‘Sodomy 2’, as Malaysian media have dubbed the trial, plays directly into the rivalry between the two politicians, who were colleagues in the ruling coalition before Anwar’s fall from glory and subsequent jailing.
It’s clearly an attempt to weaken the opposition leader in a political maneuver.
The 1998 trial followed the sacking of Anwar, then deputy prime minister, by Prime Minister Mahathir Mohamad. It was widely seen as a plot by Mr. Mahathir to destroy Anwar’s career and drew foreign criticism as a show trial. Vice President Al Gore said it “mocked international standards of justice.”
Critics say court is biased
In pre-trial hearings, Anwar’s lawyers have sparred with judges over the sharing of prosecution evidence, including medical records of the accuser. Critics have derided the court as biased and pointed out that the current Attorney General Gani Patail was found to have fabricated evidence in the 1998 case.
But it’s too soon to assess the court’s ability to handle the controversial case. In 1998 you could say quite safely that Malaysia had a judiciary that was extremely responsive to executive dictates. The judiciary right now … do not seem to be as much under the thumb as they used to be. By Simon Montlake for The Christian Science Monitor
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Om Swastiastu ...
The immigration department has suddenly introduced changes in the visa-on-arrival system. Read why tourism officials and tourism businesses are less than unanimous in their praise for the new program.
Other leading news stories this week include a critical review on Bali's handling the rabies epidemic by experts at a conference organized by Bali's Udayana University; a report that overpass highways may be under construction near Kuta before the end of 2010; a threat to close the 500-car fleet of Blue Bird Taxis in Bali; and the bad news that PLN power outages, despite assurance from PLN to the contrary, may not be over yet.
The Governor has called on entrepreneurial schools to be established to teach the Balinese how to compete internationally. Erosion on the beaches of Nusa Dua prompt emergency talks between Melia Bali and Badung's Regent. And, the Denpasar Municipal government is building bicycle paths in Renon and Sanur.
Plans have been announced to build a new luxury hotel on Sanur Beach – The Regent Bali.
In a hurry to get to Bali? Cathay Pacific is changing its Trans-Pacific schedules permitting same day connections between Los Angeles and Bali over Hong Kong.
We introduce a new celebrity chef at The Elysian and have a final interview with the very personable Robert Lagerwey who is leaving the helm of The Bulgari Resort Bali.
Want to talk to the animals? Read about the coverage the Mara River Resort and Balidisocvery.com received last weekend in The Sydney Morning Herald.
Finally, the island is abuzz with news of a new property law that will allow easier ownership of land in Bali for foreigners. Read this week's editorial and why we wonder if such a change bodes badly for the people of Bali and their culture.
Full report is available at: http://www.balidiscovery.com/update/update699.asp
Om Çanti Çanti Çanti Om ...
J.M. Daniels - Bali Update
Bali Discovery Tours
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